In a largest fund raise via digital, Nippon India NFO garners ₹720 cr

Suresh P Iyengar Mumbai | Updated on August 24, 2020

Multi Asset Fund attracts 80,000 investors; to invest in commodity derivatives, gold ETFs

Nippon Life India Asset Management Company has garnered over ₹720 crore through the largest ever digital new fund offer this fiscal.

Notwithstanding the challenges posed by Covid, the fund house has attracted investment from over 80,000 investors from 370 locations for the one-of-its kind Nippon India Multi Asset Fund, which invests across asset classes including Exchange Traded Commodity Derivatives and Gold ETFs. The fund house has received 25,000 SIP (systematic investment plan) applications for the NFO.

The fund will invest 50 per cent of its assets in Indian equities, 20 per cent in international equities, 15 per cent in commodities and the remaining in Debt and Money Market Instruments.

Making inroads

Sundeep Sikka, CEO, Nippon India AMC said the overwhelming response across nook-and-corner of the country for the first NFO after the change in ownership establishes the fact that Nippon India Mutual Fund brand has been well accepted by investors, contrary to questions being raised earlier on the ability of foreign brand making inroads rural in India.

Moreover, he said the latest technology adopted by the fund house 3-4 years back has come handy to manage such a huge response for the NFO during the difficult Covid lockdown period.

The fund has received investments not only from retail investors but also from across Family Offices and High Networth individuals. Unlike other funds, the new multi cap fund of Nippon India will invest directly in overseas markets and not through ETFs of other foreign fund house.

With the use of technology, Sikka said the operational efficiency of the fund house has improved multi-fold leading to cost savings, but that does not mean the branch expansion plans has been put on backburner.

Over a period of time each asset classes score over the other and the Nippon India Multi Asset Fund will accomplish the difficult task of timing the market for investors, he added. On Indian equity market, Sikka said investors can write-off this fiscal as far as corporate earning growth is concern and at best it would be last fiscal level. However, he said an EPS (earnings per share) growth of 22-25 per cent can be expected in FY’22.

Published on August 24, 2020

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